Angola is using rising oil prices to expedite debt payback plans and smooth out payments to China, its main creditor.
Repayments will be increased next year, according to Finance Minister Vera Daves.
After settling loans totaling US$1.32 billion this year, Africa’s second-largest petroleum producer owes China US$18 billion, or almost 40% of its entire external debt.
Angola’s debt as a percentage of GDP is expected to shrink to around 61 percent in 2023, down from 66 percent this year and more than 100 percent in 2020.
Daves attributed the metric’s improvement to the nation’s economy picking up, the currency, the government’s cautious approach to taking on new loans, and its commitment to lowering interest rates.
Due to stable oil prices and high interest rates, the Angolan kwanza has increased by 21% against the US dollar this year.
Although its options are constrained in the current global situation, the government claimed it hopes to free up money by diversifying its sources of finance and further lowering its borrowing rates.
According to Daves, the nation would take great care while entering the market.
In order to build new infrastructure, Daves continued, “We will focus more on the use of concessional and semi-concessional financing, the sale of local bonds to foreign investors, the utilization of structured commercial loans from export credit agencies, and partnerships with private investors and multilateral finance institutions.”